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3.
• Quality and productivity are twin paths to creating
value for both customers and companies
• ƒQuality - focuses on the benefits created for
customers
• Productivity - addresses financial costs incurred by firm
Deliver Quality Experience to Customers
More Efficiently
Achieve Long term Profitability
Integrating Service Quality and Productivity Strategies

4.
“A comparison of expectations with
performance”
What is Service Quality ?
However, there is debate
Disconfirmation Models Vs Perception Models

12.
Strategies to close the gap
Establish the right Service processes and specify standards
 Get the customer service process right
 Develop tiered service products that meet
customer expectations
 Set, Communicate & reinforce measurable
customer oriented service standards for all
divisions
Challenges
Gap 2 – The Policy Gap
 Gap 1 leads to create Gap 2
 Different Customer expectations

13.
Strategies to close the gap
Ensure that performance meets standards
 Ensure that customer service teams are
motivated and able to meet service standards.
 Install the right technology, equipment, support
processes and capacity.
 Manage customers for service quality.
Challenges
Gap 3 – The Delivery Gap
 Can only customer service team do it?
 Right people to do it?
 Do every company do customer expectation management?

14.
Strategies to close the gap
Close the internal communications gap by ensuring that communications
promises are realistic and correctly understood by customers.
 Educate managers responsible for sales and
marketing communications about operational
capabilities
 Ensure than communications content sets realistic
customer expectations.
 Be specific with promises and manage customers’
understanding of communication content.
Challenges
Gap 4 – The Communication Gap
 Understanding of business by advertising agency

15.
Strategies to close the gap
Challenges
Tangibilize and communicate the service quality delivered.
 Make service quality tangible and
communicate the service quality.
Gap 5 – The Perception Gap
 Will it lead to higher expectations?

16.
Strategies to close the gap
Challenges
Close gap 1 to 5 consistently meet customer
expectations
Gap 6 – The Service Quality Gap
 Individual customers are different and same customer changing

26.
• Soft measures—not easily observed, must be collected
by talking to customers, employees, or others
Provide direction, guidance, and feedback to employees on ways to
achieve customer satisfaction
Can be quantified by measuring customer perceptions and beliefs ―
For example: SERVQUAL, surveys, and customer advisory panels
• ƒHard measures—can be counted, timed, or measured
through audits
Typically operational processes or outcomes
Standards often set with reference to percentage of occasions on
which a particular measure is achieved
Control charts are useful for displaying performance over time against
specific quality standards
Measuring and Improving Service Quality

29.
• Control charts to monitor a single variable
Offer a simple method of displaying performance over
time against specific quality standards
Are only good if data on which they are based is accurate
Enable easy identification of trends
• Service quality indexes
Embrace key activities that have an impact on customers
Hard Measures of Service Quality

30.
Tools to Analyze and Address Service
Quality Problems and Productivity

31.
Tools to Analyze and
Address
Service Quality
And Productivity problems

34.
• Based on the 80/20 Rule
– Consumer needs formulated into a standard
– Firm aims at achieving this standard
– But due to variation in the factors of production
(men, material, methods, and machinery), of some items that do
not conform to this standard is inevitable.
– Defectives - may not be of the same severity
– Pareto Principle applied in defect analysis - to identify the vital few
defects, which result in many numbers of defectives so that more
effort could be made to concentrate on eliminating these vital few
defects.
• Purpose – identify the principle causes of observed
outcomes
Tools to analyze (contd.,)
Pareto Analysis :

35.
Examples for Pareto principle covering many fields are;
• Marketing - few customers account for the bulk of
the sales.
• HR - few percent of the employees are responsible
for most of the absenteeism.
• Purchasing - few percent of purchase orders account
for bulk of the purchase costs.
• A few countries account for most of the world’s
population.
Tools to analyze (contd.,)

36.
The Pareto Principle represented in a diagram
Eg: Most common sources of defects, the highest occurring type of
defect, or the most frequent reasons for customer complaints etc.,
Tools to analyze (contd.,)

37.
Tools to analyze (contd.,)
Combining fishbone diagram and Pareto analysis – highlights the main
causes of service failure

41.
• TQM – Total Quality Management
– A collection of principles, techniques, processes, and best practices that
over time have been proven effective
– Continuous improvement
– based on the premise that the quality of products and processes is the
responsibility of everyone - management, workforce, suppliers, and
customers
• Have processes that continuously collect,
analyze, and act on customer information.
• All of the TQM model's elements
work together to achieve results
Systematic approaches to quality and productivity
improvements and process standardization

49.
When does improving service Reliability
Become Uneconomical ??
Determining the optimal level of Quality

50.
Quality and productivity improvement strategies together.
Deliver quality experiences more efficiently to improve long-term
profitability.
• Defining Productivity in a service Context
– Productivity measures the amount of output produced
relative to the amount of inputs used.
– Improvements in productivity require an increase in the ratio
of output to inputs ;
» Cutting resources required to create a given
volume of output
» Increasing the output obtained from a given level
of inputs
Defining & Measuring Productivity

51.
• Productivity, Efficiency and Effectiveness
– Productivity : financial valuation of outputs to the inputs
– Efficiency : comparison to a standard, time-based
– Effectiveness : degree to which an Organization is meeting its goals
• Classical technique :
– Focus on output and not outcome / efficiency and not effectiveness
– Variability – variation in quality / value of service
Eg: counting the number of calls answered per unit of time
– Increased customer throughout at the expense of perceived service
quality
Eg: hair dresser – productivity and efficiency achieved but not
effectiveness
Defining & Measuring Productivity (contd.,)

58.
• Better to look for Service process redesign opportunities that
leads to ;
– drastic improvements in productivity
– Increase service quality
• Key challenge for service firms :
– Deliver service quality and satisfaction to customer
– In cost effective ways for the firm
• Name of the game :
– Seek improvements that offer quantum leaps in service quality and
productivity at the same time
• Service Quality (efficiency and effectiveness) + Productivity 
Long term Profitability
Conclusion

59.
Thank you
Improved Service Quality and Productivity  Profitability